Consumer Reports says too many of Facebook's 900 million users don't understand or use the privacy controls. This is important because Facebook's $3.7 billion business is mostly dependent on the sale of ads targeting users based on what they've told FB (including birth date, gender, work history, education, relationships, and "likes").
FB can track users on any web page where a FB "like" button is located. It will soon serve up ads relevant to user profiles and interactions when users visit non-FB sites. Apparently, it has been tracking FB users even after they log out. And a great many FB users simply don't trust FB.
If consumers resist ads on TV, at the movies, at the beginning of DVDs, and in so many other places, do they want ads appearing next to FB updates of friends and Instagram photos of cousins or kids? Questions are already being raised about the efficacy of FB ads for some categories (GM recently decided against continuing its FB ads for cars). But social media is still expanding, and marketers are experimenting to see what works for their products and audiences.